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Analysts expect more music studios to follow

Apple may have to pay royalties in 2007 for every iPod shipped in 2007 if Universal Music Group successfully negotiates an agreement with Apple. Earlier this year, DailyTech reported that Universal had struck a deal with Microsoft and its Zune portable music player. Microsoft would pay royalty fees for every song downloaded by a user and every Zune player sold. Similar to a tax, this contract was definitely a big win for Universal and the music industry.

Now, Universal is indicating that it wants to have the same contract setup with Apple too. According to Universal's chief executive Doug Morris, he is already communicating with Apple about the possibility of an agreement. Analysts are uncertain about Apple's decision but based on the outcome Universal had with industry giant Microsoft, it is likely that the situation between Universal and Apple will be coming out the same.

In a Reuter's report, Morris said "it would be a nice idea. We have a negotiation coming up not too far. I don't see why we wouldn't do that... but maybe not in the same way. The Zune (deal) was an amazingly interesting exercise, to end up with a piece of technology."

It will be certainly interesting to see the outcome that Universal has with Apple, considering that Apple leads the number spot for portable music players. The iPod is such a staple of the portable music industry scene that it was certainly difficult for Universal to ignore. Other major music studios and labels may end up seeking similar negotiations


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RE: Ridiculous
By AlexWade on 12/1/2006 10:03:47 PM , Rating: 1
Why can't Universal do what you said? Because that would involve listen to the customer and think about what would work instead what would give Big Label, Inc. the most money. You can bet every last penny you have the artists won't see one cent from this tax.

In any other business, the RIAA and MPAA would have been long ago out of business for the way they treat customers: like criminals.


"If they're going to pirate somebody, we want it to be us rather than somebody else." -- Microsoft Business Group President Jeff Raikes

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